IDC Viewpoint: Dell Expands Virtualization Capabilities through Wyse Acquisition

(PresseBox) (Frankfurt am Main, ) Top Line: This acquisition is another step towards the realisation of Dell's stated ambition to cover the range of technologies and services from thin clients to servers.

Last week Dell announced that it has signed a definitive agreement to acquire Wyse Technology; the deal is expected to close in 2Q 2012. Wyse will bring to Dell about $375 million in revenue and a complementary technology and product fit. While Dell's previous acquisitions of KACE and Everdream strengthened its traditional desktop/laptop management capabilities, Wyse will bolster Dell's thin client technology, where it until now has been working with Devon IT, an overlap that now needs to be addressed.

Bottom Line for ICT Buyers:

1. This acquisition is part of Dell's stated ambition to expand its virtualization capabilities across multiple client device technologies, as well as enterprise servers and services. Dell is also looking to enhance its capabilities to create end-to-end desktop virtualization solutions across as many Dell products as possible. However, one challenge for Dell will be to identify specific integrations points on the server or within the network to enhance the end-to-end connectivity for users and enhance the user experience. At the time of the announcement of the deal, an end-to-end preliminary integration path had not been discussed. Creating these roadmaps have got to be a top priority for Dell and Wyse to address as soon as possible. In our opinion, simplification of the client management will come from software solutions that Dell at this point does not have in house. So we expect to see Dell back on the acquisition trail soon again - this time for software capabilities.

2. As Dell moves forward with its end-to-end simplification strategy, it must also address lowered costs for the end-to-end solution on smartphones and PCs that IDC collectively refers to as client devices. For the traditional rich desktop/laptop PC environment, PC management software vendors have made significant progress in lowering management costs over the past 15-20 years. Eventually, we expect that as IT organizations look for a single management console to manage both thin and rich clients. Dell must have a compelling management case to make for acquiring and managing all client device types over their life cycle.

3. From an IT service management perspective, customer deployments require simplified workflow and automation around client device deployment and system provisioning. In some cases, this will require deeper software integration not hardware integrations. System management software vendors such as Microsoft, CA, IBM, LANDesk, HP, and Novell have been working on ensuring that managing a PC as well as other client devices is a cheaper and cheaper proposition every year. We would advise customers to continue to push vendors to simplify the solutions, and increase automation and deployment simplicity across all client devices - thin or rich. This automation and deployment simplicity can in turn lead to lowered costs that might start to rival the existing PC rich client desktop infrastructure.
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